Reinventing Healthcare Do We Really Have the Answer

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Reinventing Healthcare Do We Really Have the
Answer?
William A. Sanger September 2009
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(No Transcript)
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Verities and Balderdash
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Health Care System

• Projected to grow 6 7 annually
• 5 of the population accounts for 1 trillion of
  annual spending
• 1 of the population accounts for 700 billion of
  annual spending
• 85 of U.S. residents have some form of health
  insurance
• 60 via employer programs
• 27 via government programs

Source Centers for Medicare and Medicaid
Services Office of the Actuary, National Health
Statistics Group, as published in kaiserEDU.org,
U.S. Health Care Costs Background Brief,
accessed 8/26/09.
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there is a large number of uninsured in the
United States, reaching crisis level. It is
estimated between 47 and 50 million
Note As determined by the Survey of the Income
and Participation Division of the Census Bureau.
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True But

• Of the 47 million uninsured reported by the U.S
  Census Bureau
• 12 million are eligible for entitlement programs
  such as Medicaid, Medicare, and SCHIP
• 17 million earn more than 50,000 per year 50
  earn greater than 75,000 annually (the
  invisible)
• 3 8 million illegal immigrants
• 44 of families with income under 200 of the
  poverty level have private insurance
• Among the uninsured, approximately 35 billion
  annually is spent on healthcare services

Source National Center for Policy Analysis
Health Care Reform Do Other Countries Have the
Answers? (ncpa.org/pub/health-care-reform-do-othe
r-countries-have-the-answers).
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50 of personal bankruptcies are caused by
healthcare debt
Source National Center for Policy Analysis
Health Care Reform Do Other Countries Have the
Answers? (ncpa.org/pub/health-care-reform-do-othe
r-countries-have-the-answers).
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False

• The average medical liability in personal
  bankruptcies represents approximately 1,000 of
  indebtedness
• The average American has approximately 2,200 of
  healthcare debts

Source National Center for Policy Analysis
Health Care Reform Do Other Countries Have the
Answers? (ncpa.org/pub/health-care-reform-do-othe
r-countries-have-the-answers).
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The U.S. Healthcare System is the most
expensive in the world, yet we receive a low
level of care and
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False

• On a per capita basis, we use fewerhospital
  stays, visits, and tests thanother Organization
  for Economic Co-operation and Development (OECD)
  countries.
• No consideration to wait times and access issues
  are utilized in comparisons.
• England estimates that 1.8 million people daily,
  are out of work waiting to see a doctor or seek
  treatment.
• The average rate of per capita spending on
  healthcare in the U. S. is slightly below the
  OECD average.

Source National Center for Policy Analysis
Health Care Reform Do Other Countries Have the
Answers? (ncpa.org/pub/health-care-reform-do-othe
r-countries-have-the-answers).
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U.S. outcomes are no better or worse than other
nations
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False

• Infant mortality rates are erroneous
• Life expectancy relates more to lifestyle
  choices, rather than the differences in quality
  of healthcare
• Female cancer victims in the U.S. have a 63
  chance of a 5-year survival as compared to women
  in Europe, which is 56
• Women in the U.S. with breast cancer have a 90
  chance of a 5-year survival as compared to women
  in Europe, which is 79
• U.S. men with prostate cancer have a 99 chance
  of greater than 5 years vs. 78 in Europe
• Cancer mortality rate in Canada is 20 higher
  than in the U.S.

Source National Center for Policy Analysis
Health Care Reform Do Other Countries Have the
Answers? (ncpa.org/pub/health-care-reform-do-othe
r-countries-have-the-answers).
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Healthcare is a Global Crisisall nations
suffer from increasing cost, decreasing quality,
and lack of access
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Heres the problem

• Sheer number of people
• Provider scarcity/roles
• Misaligned incentives
• Life choices/accountability
• Lack of patient focused care/care coordination

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The Expanding Pot

• Sources
• Historical National Population Estimates July
  1, 1900 to July 1, 1999. Population Estimates
  Program, Population Division, U.S. Census Bureau.
  Internet Release Date April 11, 2000 Revised
  Date June 28, 2000.
• U.S. Bureau of the Census, Current Population
  Reports, Series P-25, Nos. 311, 917, 1095
  released on June 4, 1999.
• The 2009 Statistical Abstract Life Expectancy,
  Expectation of Life at Birth. U.S. National
  Center for Health Statistics, National Vital
  Statistics Reports (NVSR) 2005, Vol 56, No. 10,
  April 24, 2008.

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The Expanding Pot
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Increasing Number of Older Americans
Note Data for 2010-2050 are projections of the
population Reference population These data
refer to the resident population. Source U.S.
Census Bureau, Decennial Census, Population
Estimates and Projections.
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Seniors and Chronic Illness

• 91 of seniors have one or more chronic diseases
• 77 have 2 or more chronic diseases
• 55 have 3 or more chronic diseases
• More than 30 of seniors live alone
• Medicare beneficiaries see an average of 6.4 MDs
  and fill 20 prescriptions per year

Source National Coalition on Health Care.
Health Insurance Costs. http//wwwlnchc.org/fact
s/cost.shtml. Accessed 9/2/2009.
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Provider Scarcity
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Provider Scarcity

• U.S. form of healthcare delivery is broken
• Not only is there a shortage of caregivers, but
  also the medical model of one doctor/one patient
  is not sustainable with the given demographics,
  expansion of technology, and medical longevity

Source Sanger. (1986). The Impending Healthcare
Crisis. Kellogg School of Management,
Northwestern University, Evanston, Illinois.
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Nurse and Doctor Shortages Will Grow

• US nursing shortage will grow to 340,000 by 2020
• HRSA projects shortage of more than 1 million by
  2030

Source Health Affairs Dr. Richard Cooper,
Institute of Health Policy at Medical College of
Wisconsin.
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Extended Provider Roles are LimitedLittle has
Changed in 10 Years

• MD/DO centric model
• 80 of US deliveries by MD/DOs in the U.S.
• 80 of deliveries are non-physician in OECD
  countries

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Misaligned Incentives
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Misaligned Incentives

• The U.S. Healthcare system rewards activity, not
  outcomes
• Insurance companies generally are reluctant to
  pay for healthcare they pay for illness and
  sick care, and attempt to control cost by using
  disincentives
• Medicare is not what it should be
• Defensive medicine costs the U.S. approximately
  200 billion/year(1)

Source Weinstein. (2008, November). The Cost of
Defensive Medicine. American Academy of
Orthopaedic Surgeons
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Life Choices
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Accountability
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Life Choices/Accountability

• Obesity
• 37 increase in 10 years
• Obese patients consume 42 more in medical
  services
• 33 of adults in the U.S. are obese(1)(2)
• 22 of adults in the U.K. are obese
• 17 of adults in Canada are obese
• 14 of adults in Germany are obese
• 10 of adults in France are obese
• 3 of adults in Japan are obese
• 11.6 of total healthcare spending(1)
• Equivalent to 20 years aging on vital organs(3)

Note (1) As defined as BMI of 30 or greater,
National Bureau of Economic Research Source (2)
USA Today June 25, 2009 (3) Health Affairs Vol.
21 No. 2.
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Patient Focused Care/Care Coordination
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Central Elements of Patient Focused Care

• Data collection and storage
• Disease management (care coordination)
• Incentives

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Disease Management/Care Coordination

• Chronic diseases (cardio vascular disease,
  cancer, diabetes, mental illness) are among the
  most prevalent, costly, and preventable of health
  problems
• Medical costs associated with chronic diseases
  account for 75 of the 2 trillion spent annually
• The average Medicare patient with multiple
  chronic diseases in 2002 saw an average of 14
  different(1) physicians

Source Vogeli. (2008) Multiple Chronic
Conditions, Journal of General Internal Medicine
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U.S. Healthcare Consumer Experiences with Poor
Coordination of Care
Source Adapted from Commonwealth Fund Survey of
Public Views of the U.S. Health Care System, 2008.
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Chronic Care ? Acute Care Cycle
Acute Incident
Condition Gets Worse
Situation Normal
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Consumer-Centered Healthcare
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Secondary Prevention Flattening the Curve
Early Detection
Situation Normal
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Patient Focused Care
Source Adapted from Commonwealth Fund Survey of
Public Views of the U.S. Health Care System, 2008.
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Silos of Trapped Health Data
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Data Sources and Web Applications
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Annual Savings fromConnected Health Solutions
Source Adapted from Commonwealth Fund Survey of
Public Views of the U.S. Health Care System, 2008.
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Consumers as the Aggregators
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Insurance Reform

• Make insurance mandatory with the voucher system
  (Food Stamp approach for the indigent)
• Eliminate pre-existing condition exclusions
• Let free market take its course
• But first

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Healthcare Reform

• Change model of delivery
• Require the use of HIN/patient access
• Institute rate adjustments for lifestylenon-compl
  iance
• Reward providers for improvement in outcomes and
  efficiencies, not justsick-care

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Stop trying to predict the future invent it.